The Waring III Plan

Willis, TX 77318

$264,990F

5 bd · 2.5 ba · 2,738 sqft · Built — · SingleFamily · Active · 23 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,392/mo
• Mortgage (P&I): −$2,039
• Tax + insurance: −$648
• HOA: −$0
• Vac / Maint / Mgmt: −$502
• Net cashflow: $-797/mo
• Annual: $-9,569/yr
• Cap rate: 3.83%
• Cash-on-cash: -8.79%
• DSCR: 0.61
• 1% rule: 0.62%
• Cash to close: $108,863

Investor read

• This is a 5-bed/2.5-bath single-family listed at $265k. Condition is rated good.
• At list price, monthly cash flow is $-797 ($-10k/yr) — negative.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $239k (9.7% below list).
• It's been on market 23 days — a 2% lower offer ($261k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $239k (9.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 62/100 on livability (#933 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime C-, schools D+, employment D+.
• Willis ISD (rural): math 33% / reading 40% proficiency, ranked #458 of 826 in TX (top 55%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents soft (-2.1%/yr); 1199 active listings in the ZIP; solid renter incomes; 13,259 units permitted in Montgomery County in 2024 (1,402 in 5+ unit buildings).
• Montgomery County population projected at +65% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• This rent runs 31% of the median local income ($92k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.